Across the Pond: Navigating the longevity opportunity

0:00Welcome to another episode of Across Upon, where we discuss the big stories and top investment ideas from the Eurozone and Switzerland. Advances in healthcare and living standards mean people are living longer than ever. At the same time, we're seeing a big demographic shift. In 2024, 830 million people were aged 65 and over. That's 10% of the global population. By 2050, that number is expected to reach 1.6 billion. North America and Europe are leading the way with nearly one in five residents already in this age group. This combination of longer lifespams and an aging population is reshaping economies, markets and the way companies operate. That's why at the Chief Investment Office, we believe longevity will be one of the key forces driving equity markets in the coming decade. In fact, we estimate the longevity theme could unlock an 8 trillion US dollar market by 2030, with the healthcare sector already leading the way

1:03as it adapts to an aging population. In this episode, we explore why longevity matters for society, the economy and investors, highlighting the sector's poised to benefit and the emerging opportunities. I'm Belinda Peters from the Chief Investment Office, joined today by our special guest professor Nick Palmarini, Director of the UK National Innovation Center on Aging, and Diana Na, CIO's top healthcare equity analyst, to share insights on the investment implications for Europe. Thank you both so much for joining me. All right, let's start with a big picture. Most countries around the world are seeing their elderly, elderly populations grow, and in North America and Europe, nearly one in five people is already age 65 or older. Nick, just how significant is this shift? And what do you think this really means for a society, the economy and perhaps financial markets? So good to be here, Belinda, thanks for inviting me. The shift is a giga shift, as we used to say. We have two giga trends happening at the planet,

2:04climate change and aging. So climate change has been quite well addressed from many perspective, but aging still remains probably one of the biggest challenge, but also opportunity that we have as a society. We are shifting from what we have defining an age in society to Ellen Javiti society. So it's not only a matter of getting old, but also the fact that there is a demographic factor that we're not making children anymore, combining these two factors and the fact that somehow we're living for longer are literally redesigning the society the way we have envisioned so far. And it's something that it's touching literally all the dimension, it's touching a very individual dimension, but it's mainly also a societal dimension, it's a behavioral dimension, it's a political dimension, sometimes gets to be forgotten. Somehow we treat Ellen Javiti as it's something happening to us and we observe it, but we don't do anything to change the way we approach it, while this is something that literally is touching all the dimensions of life that goes from the very individual to the very broad.

3:06And from the individual perspective, the research we've done with Fidelis Samai suggesting, for example, how many challenges we have ahead of us, if we don't think over about the opportunity to leave the longer life that we have ahead, the fact we're not prepared for that longer life, from a financial perspective, but also from a physical, mental, societal perspective, allow us to think that literally we have the probably much needed opportunity to redesign society today, given all the factors happening around us, and envision it from the perspective of the demographic change. I guess we're sitting on a fantastic opportunity we should not miss. So it does sound like companies are facing both challenges and opportunities. Do you think companies are prepared for a world that where people could live longer? I think it's part of this logical shift that we should have to take together. I guess we're still thinking, for example, in framing the population through generations, as being framed in the 90s, and we always follow that schema so that the generation is against the other, or the same generation should

4:09share the same knowledge and understanding, but it may be it was true in an era in which we couldn't share information as fast as we're doing today, meaning that what I'm trying to explain and seeing from the research that we do is how much interconnections, for example, are between the generations, but the marketing department, let me say starting from them and the research department of the organization are still relying on a model that somehow has been disrupted, even dismantled by what is happening to all of us today, which I think is probably the biggest opportunity that companies should face is try to investigate a little bit more about a concept of serving older people because yes, they have accumulated a little more, let me say capital so that they could spend more. There's much more than that because this story is not only for older adults, it's through the life course of people. So that's the opportunity, it's far broader and somehow hidden that requires the innovation that this shift that it's happening would deserve,

5:12that I think might give a lot of return on the investment that companies would like to do on that side. And Diana, what do you think from maybe an investor's perspective, how companies are tapping into the longevity opportunity? Do you see any innovations as they adapt to meet the needs of an aging population? Great, thanks, Belinda. So I probably think about the longevity opportunity in two layers. On one side, you've got companies focused on extending not just lifespan, but health spans, so the number of years, you know, people stay healthy. And that's where most healthcare companies sit, which we view to be the immediate and direct opportunities. But then, you know, there's a much broader opportunity beyond healthcare because, you know, people are staying active for longer and consuming differently. So within healthcare, you know, one of the biggest shifts is that aging is no longer seen as something that just happens right at the end of life. It's increasingly managed as a long-term proactive process. So you're seeing

6:17a move upstream towards prevention, earlier diagnosis and intervention. And that's critical, you know, both for improving patient outcomes and for reducing pressure on healthcare systems over time. And a great example of that, all the GLP-1 therapies, you know, they're often in a framed as weight loss drugs. But the bigger picture is that they can reduce in a downstream complications like cardiovascular diseases and things like heart attacks and strokes, you know, which are still leading causes of mortality today. So by intervening earlier, you're essentially preventing more serious, you know, issues later on. And you see a similar trend in other areas, like oncology as well, where there's now much more focus on early detection and treating disease, you know, before it progresses and becomes harder to manage. Equally, you know, companies are also adapting to better serve and older population. In medical devices, for instance,

7:17there's a big push towards more decentralized care, things like remote monitoring or wearables, which allow people to stay independent for longer, rather than relying on hospital-based care. Then, you know, beyond healthcare, the opportunity really opens up. So, you know, consumer companies are designing products for older, but still very active individuals. Then you have financial firms that are focusing more on retirement income and longevity solutions, you know, to help people prepare financially. And even in real estate, you know, you're seeing a growing demand for age-friendly housing. So overall, you know, the companies that are best positioned to capitalize on the longevity opportunity are the ones taking a more holistic approach, you know, thinking not just about extending life, but improving quality of life over a much longer period. And Nick, you've also spoken in your research about adding intelligence to aging. Maybe you could

8:20briefly explain what this concept means and how it has tangibly improved a product or a business strategy in practice? Yes. What do you think it's missing and we observe it missing in the longevity economy as we define it? It's, let me say, a set of principles, methodologies, tools, data that you have basically for each one of the other industries, but not yet well-framed for longevity. That's what we did. It's a lack of intelligence so we can provide organization, public and private, with the knowledge and understanding what the things that matters to people, for example, are what the things that could matter to this company. So we have framed in 2019 this concept as aging intelligence and we've been developing innovation on that science system, developing the tools, the data, the framework that somehow the industry was and somehow is still missing. So there is a lot of space there to develop innovation to better serve the organization that will serve us as individuals. In the process of aging intelligence,

9:20intelligence will always engage the people in the debates. So one of the core assets that we have is engage in a community of older adults to discuss with us what could be the need and the desires of their future lives. And as being translated in practical application to many industries, I can quote, for example, developing working robots with Piazza Fess forward, helping organization like SLOR Luxotica to better serve the redesign of the framing so that they can also help people not only that has issues with sightseeing but also with the hearing loss, helping companies in the financial space, in the entertainment space, in the transportation space, working with cities, working with also international organizations. There is a need of innovation in every field which I recommend each one listening to us today to try to explore and see longevity as a broad and connected, let me say, mapping of what could be the life elements that could help us leaving health or longer lives and not simply only from a healthcare perspective. So Diana, it seems

10:23that technology and AI are becoming increasingly central to longevity, I would say. So where do you see digital health and AI making the biggest impact and do you see any investment implications? Yes, I mean, it's a great question because AI is becoming increasingly central to the longevity theme. If we start with healthcare, where the impact is more immediate, so AI is already being applied across the entire value chain. So most companies are either building internal capabilities or partnering with tech firms to access them. So in the case of Farmer, the main use case today is in drug discovery and in clinical development. So AI is essentially helping with things like target identification and trial design, which should reduce both time and cost. Now we having quite seen a full step change in Farmer R&D productivity yet, but we are seeing a gradual expansion

11:28in the number of drug targets at the preclinical stage, which is a positive signal for the industry. Where the impact feels more tangible is in the diagnostics and the imaging side. So AI can analyze large data sets quickly and in some cases more accurately than humans. So you get earlier detection and that's key because in longevity, earlier intervention drives better outcomes. Now looking ahead, I think the biggest opportunity is really around personalized healthcare. We're moving away from this one size fits all approach in the towards something much more individual. So using AI to combine genomics and medical records to predict risk earlier. So basically shifting from treatment to managing health over time, which is at the core of longevity.

12:28Now from an investment perspective, this really widened the lens is not just about Farmer or diagnostics. It's companies that can combine data, technology and clinical applications. But overall, I still think we're in the early stages of realizing the full potential. But over time, AI has the ability to make healthcare much more predictive in the line with longevity, which creates a compelling opportunity set. And Nick, you've said that longevity is about life, not just biology. I'm most curious to know if that means that the biggest business opportunities are actually outside of traditional healthcare. It is indeed. I guess we are missing a business model for prevention, which probably lies at the background of what we're saying. We have a wonderful, well-working business model for healthcare, for care. It's a let me say sick care model, which is working so well and thanks God we have it. But we're not seeing the other side of the coin. We know that 80%

13:29of not communicable diseases could be prevented. Hence, there is a huge space on how we can design better strategies for our life in somehow helping us change in behaviors, changing our lifestyles, be part of a far more, let me say, personalize an interactive way on how we can design our future strategy for health. Meaning that it's an opportunity that touches every industry. And that's where we think the real opportunity of a difference between the silver economy and longevity common lies. The silver economy is an economy which is waiting us to get all somehow and just try to fix what could be the needs happening later in life. Elangieft economy is an economy that help us that guide us, that suggests us how we can overall the life course, take advantage of the things that can improve our health journey to win. Let me say the fantastic gift of a healthier longer life. Diana, do you agree perhaps that investors are focused too much on healthcare? And if there are any other overlooked areas that could potentially drive growth?

14:31Yes, I mean, look, I still think healthcare is still in a central to the longevity theme as people age, the risk of chronic diseases increases. So it's a big part of the story, but not the whole story. In fact, some of the most interesting momentum we're seeing is on the consumer side. If the goal is to live longer and healthier, the focus naturally shifts towards prevention and that comes down to things like nutrition, exercise and mental wellbeing. So you're seeing a lot of innovation in the areas like food, supplements and even beauty where products are more positioned around healthy aging. And one theme that's really gaining traction is this idea of food as medicine. There's a growing awareness that what you eat plays a big role in long-term health, especially for cardiometabolic conditions. So demand is rising for more functional science-backed products, whether that's for gut health, blood sugar control,

15:36overall wellbeing, and that's becoming more mainstream. So from an investor angle, these areas tend to be more scalable and they're generally less regulated than traditional farmer. Plus, they're also supportive by a strong consumer base. So older consumers tend to hold a larger share of wealth and are increasingly willing to spend on staying healthy and having a higher quality of life. So if anything, I'd say investors might be underestimating this side of the story. Of course, in a healthcare still essential, but a growing share of the opportunity is likely to come from consumer innovation going forward. And so far we've talked about how important is to reframe longevity. And in this podcast, we always try to bring it back to Europe. So more concretely, where do you see the most interesting longevity-driven opportunities right now, Diana?

16:36Yes, thanks a lot. I mean, I think Europe is often underestimated when it comes to longevity opportunities. Where it really stands out is in the healthcare innovation, especially in places like the UK and Switzerland. There's a strong link between academic research and commercialization and a pretty solid track record of turning early stage science into real products, you know, whether that's drugs, medical devices or diagnostics. So from an investment lens, you know, that innovation engine still feels somewhat underappreciated. Unfortunately, the healthcare sector did come under pressure last year, largely due to US policy concerns, but with some of the drug pricing agreements now in place, you know, that overhang is easing. Within healthcare, oncology remains a key area of growth opportunity, a significant share of

17:40clinical trials are still focused there. And we're seeing a shift in a towards more targeted precision therapies, which is resulting in differentiated treatments. Another area I'd highlight is cardiometabolic health, you know, especially, you know, since the focus shifts more towards prevention. We're seeing continued innovation, you know, from next generation, Geopie 1 therapies, to broader approaches on targeting cardiovascular risk. And that has the potential to expand the market quite meaningfully over time. But as discussed before, you know, it's not only about healthcare, you know, Europe's aging population is also driving demand across areas like food and nutrition, the leisure market and real estate, you know, segments that tend to get less attention, but are directly supported by demographic tailwinds. So all in, you know, I'd say Europe is not only an innovation hub, but also a very clear example of how longevity

18:42translates into investable opportunities. Okay, thank you, Diana. And also thanks, Nick, for joining us today. We unfortunately don't have time for any more questions, but I also wanted to thank our listeners. We can delve into specific securities on these podcasts, but you can explore some of these with your UBS representative. But just to quickly sum up, investors should look at both the drivers and beneficiaries of longevity, not just companies catering directly to an aging population. In Europe, healthcare remains a core focus, especially areas like obesity, cancer, and medical devices, which are already adapting to a demographic change. Additionally, consumer companies targeting healthy aging, the leisure market and real estate developments in senior living could capitalize on the growing needs of seniors. We'll be back soon with another installment of Across Upon and in the meantime, have a great week. UBS chief investment offices, investment views are prepared and published by the global wealth management business of UBS AG or its affiliate UBS. This material has no regard to the specific investment objectives, financial situation,

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